The Unique Selling Proposition: The Foundation of Modern Marketing

In 1961 marketing pioneer Rosser Reeves introduced the concept of the Unique Selling Proposition (USP) in his book Reality in Advertising. Since then the USP has become the foundation of modern marketing. In recent years the Internet has brought the concept to a wider audience.

Despite this, relatively few have truly grasped the essence of the USP or how to apply it. The term is often used loosely to describe other types of sales offers that are not really USPs. There are also some newer spinoffs of the USP that are not exactly USPs either. Here I will clarify what a USP is and contrast it with some of its close relatives. In the process I will give some guidelines for creating USPs, along with some examples.

The Elements of the USP

As its name indicates, there are three main components to the Unique Selling Proposition:

First, a USP must make a proposition: an offer to perform a specific action in exchange for a specific benefit. The action is often obvious enough to be implied instead of explicit. Reeves’ USP for M&M’s was the slogan, “M&M’s melt in your mouth, not in your hands.” The benefit of melting in your mouth instead of your hands was explicit. The unstated implication was that you had to buy M&M’s to get this benefit.

Second, a USP must make a sellingproposition, with a benefit compelling enough to motivate action. Reeves’ USP for Colgate emphasized how Colgate guards you with an invisible shield against tooth decay and bad breath. To dramatize this point, Colgate’s commercial showed a tennis serve coming at the camera full-speed, nearly hitting the narrator, only to be stopped with a loud smash by an invisible shield just in front of his head. The dramatization made the benefit more compelling by tying it into the survival instinct: use Colgate if you don’t want to get smashed in the mouth!

Third, a USP must make a uniqueproposition, offering something competitors can’t or don’t offer. Reeves’ USP for Anacin emphasized the difference between aspirin, pain relievers that add a “buffering” coat, and Anacin. Aspirin and buffering pain remedies only relieved headaches one way, by attacking pain, Anacin’s commercial claimed; but only Anacin relieved headaches three ways, by not only attacking pain but also by attacking the depression and tension that accompany headaches.

Creating USPs

How do you create a USP? There are a few major methods of developing unique offers.

The first and most common tactic is to offer a unique price. Most businesses using this method offer a lower price than the competition. This can work if you have the resources to sell on a large scale and keep your overhead lower than your competition, like Walmart. But it doesn’t work well for most smaller businesses, because it tends to lower your profit margin too far to make good business sense. A different version of this tactic is targeting the luxury price market. This often proves more profitable, as long as your product justifies the price and you can keep up with your competitors.

A second tactic is to offer a unique value. This can take the form of a unique benefit, a unique process, a unique guarantee, unique customer service, or any other unique value you can offer. Burger King is the Home of the Whopper: you can’t get a Whopper at McDonald’s.

A third tactic is offering the same value as competitors at the same price in greater quantity. This can mean offering more of one product or service. In 1984 Wendy’s successfully distinguished itself from McDonald’s and Burger King on quantity with its “Where’s the beef?” campaign. This tactic can also take the form of bundling several products or services together into a package, as when Microsoft bundles their software with Dell or Hewlett-Packard computers.

A fourth tactic is to offer your proposition to a unique marketniche. A common version of this tactic is offering something unique to a local geographical market. An example is a medical clinic featuring the only specialist of a particular type in the area. There are many other ways to segment a market by age, gender, language, or other variables.

Relatives of the USP

These guidelines and examples of what a USP is help clarify the difference between a USP and a few of its close relatives.

There are many sales propositions that are not USPs because what they offer is not unique. For example, one corner may have several gas stations all advertising the same price. As this illustrates, some sales propositions are very successful without being USPs. This often happens when a business is a pioneer in its field and it does not have any significant competition yet. It can also happen after a field has become so saturated with competitors that none of them can really stand out, as with our gas station example. A USP is most applicable when there is a need to stand out from the competition. The best opportunity to deploy a USP is in a growing industry where there is still room for innovation to make one player stand out from the crowd. A USP can also be useful to overcome consumer resistance after a market has become disillusioned with advertising hype and is looking for a new solution to the same problem.

Today many marketing consultants emphasize the concept of brandingover USPs. There is a lot of overlap between these concepts, but there are also some differences. Branding is about the uniqueness of a business rather than a specific product or service it offers. Like a USP, it involves the unique benefits that business offers, but it also includes things like the unique images, feelings, values, and personalities associated with that business. Because of this, a brand is usually associated with a person or mascot. Walt Disney and Mickey Mouse gave a face to Disney that made its brand distinct from Warner Brothers. Martin the Lizard, sensitive Cavemen, and Rod Serling lookalike Mike McGlone have branded GEICO. (“Could switching to GEICO really save you 15% or more on car insurance? Did the little piggy cry ‘wee wee wee’ all the way home?”) Vince Lombardi branded the Green Bay Packers, just as Tom Landry and Bob Lilly branded the Dallas Cowboys and Al Davis branded the Oakland Raiders.

Finally, a recent innovation on the USP is the irresistible offer, first named by Mark Joyner but in play before he coined the phrase. An irresistible offer is an offer that may or may not also be a USP. Its distinctive feature is its persuasive nature, achieved by offering exceptionally high value at such low risk that, as the phrase goes, you’d have to be crazy to make such an offer or refuse it. For many years “crazy” pitchmen for warehouse retailers have made irresistible offers by giving away large bonuses as an incentive for purchases. It’s also possible to create an irresistible offer by offering a negative incentive, as when Don Corleone announced, “I’m gonna make him an offer he can’t refuse.” Insurance salesman Ben Feldman was a master of applying this tactic by painting a grim picture of the risks of not carrying life insurance.

Of course it doesn’t hurt to combine a USP with branding, or irresistible offers, or just plain sales offers. But being aware of the difference can help you get clear on what you need in a USP.